ACCT212 Course Discussions Week 5

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ACCT212 Course Discussions Week 5
In this post, you’ll provide researched, APA sourced citations on how companies report…

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ACCT212 Course Discussions Week 5

ACCT212 Course Discussions Week 5

All Students Posts – 132 Pages 

Non-Current Assets and Related Liabilities – 69 Pages 

  1. Students are encouraged to use online collaboration tools to create a submission 2-4 minutes in length, discussing your research into the relevance of the company’s Fixed Assets (PP&E) to their core business, and how Fixed Assets (PP&E) help the company in its business.In this post, you’ll provide researched, APA sourced citations on how companies report their Fixed Assets (PP&E), and you’ll discuss what this information means to the business.

    The points given below are substantial, so far as the difference between assets and liabilities is concerned:

    1. In accounting context, assets are the property or estate which can be transformed into cash in the future, whereas liabilities are the debt which is to be settled in the future.
    2. Assets refer to the financial resources, which provide future economic benefit. Conversely, liabilities are those financial obligations, which requires being paid off in the near future.
    3. Assets are depreciable objects, i.e. every year a certain percentage or amount is deducted as depreciation. As against this, liabilities are non-depreciable.
    4. In the balance sheet, assets are shown on the right side, while liabilities are placed at the left. Further, the total of assets and total of liabilities should tally.
    5. Assets are classified as current and non-current assets. On the other hand, Liabilities are classified as current and non-current liabilities.
    6. Examples of assets – Trade Receivables, Building, Inventory, Patent, Furniture, etc., and Example of liabilities- Trade Payable, Debentures, Bank Loan, Overdraft, etc.

    PP&E plays a key part in the financial planning and analysis Links to an external site of a company’s operations and future expenditures, especially with regards to capital expenditures. Property, Plant, and Equipment (PP&E) is a non-current, tangible capital asset is for business and used to generate revenues and profits.

    Formula: Net PP&E = Gross PP&E + Capital Expenditures – Accumulated Depreciation

    For example: In May 2017, Factory Corp. owned PP&E machinery with a gross value of $5,000,000. Accumulated depreciation for the same machinery was at $2,100,000. Due to the wear and tear of the machinery, the company decided to purchase another $1,000,000 in new equipment. For this period, the depreciation expense for all old and new equipment is $150,000.

    The PP&E account is often denoted as net of accumulated depreciation. This means that if a company does not purchase additional new equipment (therefore, its capital expenditures are zero), then Net PP&E should slowly decrease in value every year due to depreciation to an external site.  This can be better determined by a depreciation schedule.  PP&E is a tangible fixed-asset account item and is generally very illiquid. A company can sell its equipment, but not as easily as it can sell its or investments such as bonds or stock shares. The value of PP&E between companies will vary with the operations. For example, a construction company will generally have a significantly higher property, plant, and equipment balance than an accounting firm does.

Course Project – 63 Pages 

Go to Course Home and review the Course Project Overview. Continue to use the Course Project template from the Files section. In this graded discussion, we will be examining the operation of the Accounting Information System (AIS) with the use of problems and exercises from your textbook. The goal is to cover all of the requirements to ensure an opportunity for your successful completion of the Course Project.

Let’s start with Exercise 3-30A. For the Anderson Production Company, select one adjusting and one closing entry requirement. Develop the journal entry for review by your peers. Make sure to reference any page numbers of examples you are using. Hint: Revisit the Week 2 Lecture.

The income summary account is a transitional account into which all income statement revenue and expense accounts are transferred at the end of an accounting period. The net amount transferred into the income summary account equals the net profit or loss that the business incurred during the period. Thus, shifting revenue out of the income statement means debiting the revenue account for the total amount of revenue recorded in the period, and crediting the income summary account. Likewise, shifting expenses out of the income statement requires you to credit all of the expense accounts for the total amount of expenses recorded in the period, and debit the income summary account. This is the first step you would take in using the income summary account.

If the resulting balance in the income summary account is a profit (which is a credit balance), then debit the income summary account for the amount of the profit and credit the retained earnings account to shift the profit into retained earnings. If the resulting balance in the income summary account is a loss then the credit income summary account for the amount of the loss and debit the retained earnings account to shift the loss into the retained earnings. This is the second step you would take in using the income summary account and this should result in that account balancing to a zero…